Penumbra, Inc. (PEN) Earnings Call Transcript & Summary

All right. I want to welcome everyone. My name is Adam Elsesser. We're webcasting this event. But welcome to the follow-on discussion of STORM-PE. We have members of the steering committee as well as Dr. Benenati. And I'm going to not talk much, but turn it over to Shruthi Narayan, our President, and she will make the proper introductions, and we'll dive into the conversation. Thank you.

Thank you, Adam. Thank you all for joining us this afternoon to talk some more about STORM-PE. The data that we just presented a couple of hours ago. Needless to say, it's a very exciting time for PE patients, for PE intervention as a whole and certainly for us here at Penumbra. As you heard from Dr. Lookstein as well as on the panel today is landmark trial and foundational evidence here. And hopefully, we will all have the opportunity to be involved in treating more and more PE patients. I do want to just introduce some members of the STORM-PE steering committee that are here with us today. We have Dr. Rob Lookstein, who is from Mount Sinai, New York, the International co-PI of the STORM-PE trial. We have Dr. Rachel Rosovsky, hematologist from Mass General, also International co-PI of the STORM-PE trial. And then we have Dr. Stavros Konstantinides from University of Mainz, who's also on the steering committee and provides global sort of representation. Along with that, other than Adam and I from Penumbra, we have Dr. Jim Benenati, our CMO, that will also moderate some of the discussion. In terms of format, we're going to actually first have Dr. Lookstein go through just the highlights from the study that we just presented earlier, and then we'll open it up for Q&A with Adam and Dr. Be moderating the Q&A session. I do want to reiterate that this event is only going to be discussing STORM-PE results that were presented today. Any questions about the business, we will defer to our third quarter earnings call in early November. And with that, I will turn it over to Dr. Lookstein.

Thank you, Shruthi. Thank you, Adam. It's a pleasure to be here in front of all of you. Again, a great day for advancing pulmonary embolism care. Can we go to the next slide, please? Okay. Thank you. Sorry about that. So this idea has been brewing for 10 years. The endovascular era for acute pulmonary embolism started 10 years ago with the ULTIMA trial. And despite the fact that there have been 7 devices that have been approved by the U.S. FDA, there have been no trials since ULTIMA that have compared any form of endovascular therapy to anticoagulation alone, which is currently the gold standard of care and in the guidelines for intermediate high-risk pulmonary embolism. There have been no randomized trials comparing mechanical thrombectomy versus anticoagulation. And so this trial that we presented today is the first randomized trial evaluating any endovascular therapy versus anticoagulation in over 10 years, and it's the first randomized trial comparing mechanical thrombectomy versus anticoagulation. And obviously, the mechanical thrombectomy device that was used as part of this trial is the CAVT, the Lightning Flash system by Penumbra, who's here today. We chose the RV to LV ratio as the primary endpoint because it's been adjudicated in countless studies in the cardiovascular literature to denote strain on the heart. The higher the RV ratio, the more strain there is from the heart from the acute pulmonary embolism. And so the idea here was very focused. We set out to demonstrate that the introduction of a CAVT procedure on top of the gold standard anticoagulation could reduce the strain on the heart faster and in a more uniform way than just treating the patient with anticoagulation alone. We use multiple safety endpoints, a composite endpoint of clinical deterioration, PE-related mortality, symptomatic recurrent PE and major bleeding. The primary efficacy endpoint was assessed by an independent blinded core lab and the secondary outcomes here, the composite safety endpoint was assessed by an independent clinical events committee. The study schedule and data collection are listed here. There are numerous functional endpoints and quality of life endpoints that will be presented later at a subsequent meeting. We're very excited to share that with you, but that was not presented this afternoon. Suffice it to say, the patients after being assessed were randomized to either again continue to receive anticoagulation alone or to undergo the CAVT procedure, and the patients were followed for a total of 90 days. The baseline assessments of these patients in both arms mapped almost perfectly. They were well-matched groups. There were no significant medical comorbidities between the 2 groups. When they presented and were assessed, they had similar vital signs. They had similar presenting symptoms. They had similar medical comorbidities. All the assessments that are been shown to have a poor prognosis for outcomes were well matched between the 2 groups. And the tools that we as physicians use to denote the degree of thrombotic burden or the clot burden in the lungs was also matched between the 2 groups. We set out to see if there was going to be a treatment effect by adding on the CAVT procedure. The endpoint is shown here. It showed that there was a reduction in the RV to LV ratio in both groups but the reduction in the CAVT group was significantly superior to anticoagulation alone. This procedure took the strain off of the right heart in a more reproducible, more uniform and in a statistically superior way than anticoagulation alone. The FDA has set out that a therapeutic effect is defined as reducing this ratio by 0.2. So we use that to demonstrate a therapeutic effect. We saw this in 78% of the patients treated with CAVT and only 52% of patients treated with anticoagulation. We also denote a normal RV to LV ratio showing that there is no strain on the heart as defined as the ratio being 1 or less, and this was observed in 39% of patients in the CAVT group and only 13% of patients in the anticoagulation group. So again, just to paraphrase this, just by introducing the CAVT procedure, almost 40% of the patients returned to a normal level with no evidence of right heart strain on their follow-up CAT scan. The safety endpoints, again, are listed here. There were 2 major adverse events in the CAVT group and 4 in the anticoagulation group. These were not statistically significant whatsoever. And so again, this is a foundational trial. It's a game changer. It's the first of its kind trial that demonstrates the efficacy and superiority of mechanical thrombectomy, obviously, in this trial, the CAVT procedure over anticoagulation alone in the treatment of intermediate high-risk patients. The procedure -- the CAVT procedure dropped the pressure on the right heart uniformly across the cohort, and this led to a statistically superior reduction in the RV to LV ratio compared to anticoagulation alone. The safety profile was comparable between the 2 groups. This once and for all, establishes on a foundation level, the role of mechanical thrombectomy to treat and rescue patients with intermediate high-risk pulmonary embolism. And again, I'll say this again, our entire trial leadership are excited and looking forward to sharing our functional data and our quality of life data at future meetings in the next weeks and months to come.

Thank you, Rob. I appreciate that. We're going to open it up to questions in just a moment. We're going to have mics. So we have to wait only because it's webcast, and we got to hear the question appropriately. So we're raising hands again. Oh, come on. You guys are going to make me pick. Let's see, hold on. Why don't you pick, Jim?

Okay. The first -- to be fair, the first hand I saw go up was yours, second row, okay? And then...

Bill Plovanic, Canaccord. Thanks for sharing that and congratulations on the study. I just want to understand or at least help me understand, how do you think the physicians will look at the fact that there were like 767 patients that were randomized and only 100 patients treated? And how do we think about that as just the opportunity, what's the true TAM? Like I mean, if you're only treating 1 out of 7 patients or less, any color would helpful.

If I could correct that, 767 patients were screened to participate in a randomized interventional trial comparing a medical therapy with an interventional therapy, right? Of those 767, a very significant percentage were not eligible to participate because they were either too sick or too healthy. The points I made before that we wanted very well matched, very symptomatic, but well-matched patients in this trial was intentional. We had a high threshold in order to allow patients into this study and the patients had to understand and agree to be randomized between a medical therapy and an interventional therapy. So we screened 767 patients in order to randomize only 100, all right? 100 patients didn't get treated with CAVT, only 43 patients were treated with CAVT. This is actually a very, very good screening ratio for a large cardiovascular trial, especially a trial that randomizes medical therapy to interventional therapy. I think Dr. Benenati and I have both participated in interventional or endovascular trials where the ratio of screened patients to randomize is 10:1 or 20:1. And so we were very happy with these results that we only had to screen 767 patients to randomize 100.

Yes. I'd just tell you that from 30 years' experience participating in trials, a 1:7 screening ratio is outstanding. We -- as Rob said, a 1:15 ratio we've seen in many trials. And part of that is because when you randomize someone, you have to look at a patient and say, you have to agree to a coin toss. And most -- in a single-arm study, you could say, I have a new device, would you like to try that? That's a much easier question for a patient to answer than for them to have to say, I'm willing to...

There's another part of his question, if I can play the role of follow-up here. And that is what is your perception? It's unrelated to the number of patients screening, which is where that cut. sort of on to a different topic. But what's your perception of the opportunity? How many more patients given this trial can we help in terms of like a percentage more?

So the prevalence of intermediate high-risk pulmonary embolism across the United States is estimated somewhere between 15% and 25% of all pulmonary embolism. The incidence of pulmonary embolism with screening with CT pulmonary angiography can be as high as 900,000 in the U.S. So I'm not going to do the arithmetic, but you're talking about tens of thousands, if not hundreds of thousands of patients just in the U.S. And then obviously, you have the opportunity to expand the reach of this disruptive therapeutic option to the entire globe. So it's a huge opportunity to really improve the care that we're providing just to this subset of acute pulmonary embolism.

I just wanted to add, up until today, if you look at the guidelines, the American Heart Association guidelines, the European guidelines, CES guidelines, PERC guidelines, when you look at the intermediate high risk and how to treat those, it's all anticoagulate and then monitor and consider rescue reperfusion if the person deteriorates. So there's been no guidance up until today to help us think about is there a better way to treat those patients? And this is the first trial, which is really a game changer because we now have evidence. We have evidence that you don't actually have to wait until these people deteriorate that you can actually do it upfront. So I think this is the trial we've all been waiting for literally for a decade. So when you think about those patients, it's the intermediate high risk. And to your point, it's those people that have strain of their heart, not just on their echo or their CAT scan, but also in the biomarkers. So it's those high risk. And if you look at the mortality rate, we know patients that have high risk, those are the people that are hypotensive, their mortality rate can be in the 40s, 50s at 3 months. But we also know the people that are in the intermediate risk, their mortality rate can be up to 15%. So this is a real important issue because when you think about the RV-LV, that strain on the heart, when you look at those patients and you wait until they deteriorate, you wait until they become hypotensive, then if you look at that curve of who dies from mortality, it shoots way up. And so you want to prevent people from getting to that point where they're straining the heart so much they're becoming hypotensive because then the risk of mortality goes way up.

Stavros, any comments about the screening, the number of patients, the randomization process?

No, I only want to fully agree that a screen of 7:1 screening ratio is a good ratio. There are 2 things to that. trials, as you all know, are highly regulated, right? We have very strict rules on whom to include, particularly on whom to exclude from trials. So sometimes it could be that, first, the patients do not meet the criteria of the protocol of the trial or sometimes there are other issues, some other diseases that prevent us from randomizing these patients. So this is a good ratio. And another part and another mark of the quality of this trial is the fact that the screening ratio was very well and consistently documented. This is not something that happens always. Sometimes some centers do not document all the patients that they screen. They say, we had a very high randomization ratio, but it has to be done in a diligent and honest manner, and this is what was done in this trial. And so we have a representative and I would say, objective screening ratio of 7:1. And I also agree that this is a good one.

Jim, next question?

Yes, Cecilia. Please pass the mic to the next person.

Robbie Marcus from JPMorgan. Congrats on the nice trial. Two questions for me. First, how important will the secondary endpoints be? I believe mortality is one of them. Do you think this -- the RV to LV unloading alone is enough to drive adoption? Do you think you'll need the secondary endpoints? And then the second one, I'll ask up top. How do you think about guideline changes? You talked about the need, more data evidence. We have, I believe, 3 more trials coming looking at this. The trial is great, but it's still fairly small in size. Do you think you'll need along with the other 3, assuming they all read out positively, will that be enough to change guidelines?

So I'll answer the first part, and then I'll defer the guidelines question to my colleague down the row, Stavros, who I think has a little bit more insight to that. So we had to demonstrate the RV to LV ratio as the primary endpoint because they've never been done before. Again, just to reemphasize this issue, there's not been an endovascular trial in 10 years. There have never been one for mechanical thrombectomy, not the least of which is CAVT. So that -- we had to demonstrate efficacy. I'll say this again. We are very excited to share the functional out points with you in the near future, but we obviously can't go into details about that for obvious reasons. But we do think that the wealth of evidence that's going to be shared over the next weeks and months will be very, very exciting for the entire field. Stavros, do you want to talk about what's going to go into the guidelines and how the other trials will frame into that?

Yes. So what the guidelines need for recommending some sort of therapy is randomized controlled trials. And I must say it was thought for a long time, actually until now, that such trials are not possible for devices in PE. So people thought there will never be state-of-the-art trials, and this is why there was all this discussion because there were believers and nonbelievers, but there was no one to judge, I mean, can this now really be formally recommended. And the criteria for recommending some device or a drug are quite -- are the same amongst guidelines. So you need to run a state-of-the-art randomized control trial. The guidelines, there is no number of patients that the guidance -- that the trial has to have in, right? So it's not the number of patients. It's the effect how relevant the effect is, and this is what Dr. Lookstein alluded to, I mean, RV to LV ratio is something that has been established for years, actually since the early '90s. And by coincidence, I didn't know it back then, I was quite young. It was first proposed in Mainz, actually, the university by my later supervisor. And then it was taken up also by the team of Professor Goldhaber here in Harvard Medical School. So this is -- so one is that the guideline says there is superiority based on these criteria. And then if this is also a clinically relevant endpoint, and this is the case for RV-LV, the guidelines will say, yes, we recommend this type of treatment versus the standard of care until now with a level of evidence. Now when more trials come, what changes is not the recommendation, provided that the results are consistent, of course. If one trial says one and the other, then it's a different story. But if the results are consistent, then what changes is not the recommendation, it's the level of evidence. So if you have more than one randomized control trials, then you move up from level of evidence B to level of evidence A. But the recommendation can be based -- a strong recommendation can be based on a single state-of-the-art randomized control trial.

Okay. Let's grab another question.

Chris Pasquale, Nephron. I wanted to ask along similar vein about translating these data into actual clinical adoption. Curious about the audience that needs to really be convinced for this to become -- to move that needle on what's considered standard of care. You're in front of a very interventionalist audience today. The additional data is going to be a different audience, but again, lots of folks that do procedures. With pulmonary embolism, how broad is the audience you really need to get to? Are there a lot of physicians who are not going to be reading this manuscript, not going to be seeing the slides that need to be convinced before patients can get consistent therapy?

Rachel, do you want to take that and comment about the publication? I think there's a lot of people who aren't interventionalists that this is targeted to.

Yes. So I'm not an interventionalist, I'm a hematologist. So the fact that on their steering committee and actually, the co-global PI was a non-interventionalist was intentional and very important. And I think the question you asked is also very important. I think this is the first place that we've announced this. We will be having a publication come out once we get all of our data, the secondary endpoints as well. And then that will be -- our goal is to get that in a very high-end journal, which will then be able to reach not just interventionalists. There's also various other conferences over the next year or 2 that we will be targeting. And then the other thing is this was in partnership with the pulmonary embolism response team consortium. And we've recently launched something with Penumbra called PRISM. And the goal of PRISM is actually to exactly what you're saying -- is to get this information out to all of the people. And as Rob alluded to, the majority of patients that were on -- put in this trial had PERT teams already. And if you think about a PERT team that's multidisciplinary, that's not just the interventionalist, it's the critical care, the pulmonologists, the emergency room physicians, the hematologists, the pharmacists, the nurses, all of those people. And so we need to think about educating all of those people about this trial so that it can be adopted. We recently did also -- this was sponsored by Penumbra called Get out the Clot, which kind of looked at once people's understanding right now of how these devices are used and we were shocked to find that actually the majority of people might not have the best understanding of where these should be used. And I think this is a huge opportunity. The fact that this trial has shown this. And when we get secondary outcomes, we'll be able to share those as well. I think that's going to launch this and allow us to really educate everybody that's taken care of PE. I think that's so important. And I think your question actually speaks to just raising awareness about PE in general. If you look at what thrombosis data a survey that looked at just participants who knew what a PE was. And they looked at MI, about 90% of people knew what an MI was, 90% of people knew what a stroke was. Only 50% of people that they surveyed knew what a PE was. So our work is cut out for us, and I think this is opening the door to allow us to really share this.

Wouldn't you say that in the PERT membership, the majority of people are non-interventionalists? This trial is done in conjunction with PERT. So as this gets through the PERT as this is to disseminate through PERT, the majority of people this is going to are non-interventionalists. So that was a specific target in the design of this trial. It's the reason we collaborated with a noninterventional group primarily. And your point, again, well taken, and it's something that we targeted and executed on completely. Next question?

Joanne Wuensch from Citibank. Thank you for presenting this data. It's impressive. I think the question I have is, to take off of everyone else's question, what has to be done. It's the additional data. We hit upon that. It's the publication. We hit upon that. Do you need changes in guidelines? Do you need changes in reimbursement? Do you need more than 100 patients? I'm trying to go from today's wonderful data presentation to adoption and what steps have to come from here to there.

I'll take a stab at that. I think that this trial -- to quote my dear colleague, opens the door. There are countless providers across the United States and around the globe that have a little bit of skepticism don't necessarily understand that this is a safe and effective therapy. And I think this trial allows us to embrace this technology as a safe and effective therapy to rescue patients that are presenting to our emergency rooms with the right heart strain. We have to start somewhere, and I believe this is a foundational trial that allows the majority of the medical community that are treating patients with acute pulmonary embolism to recognize. Again, this is an effective therapeutic option in our armamentarium. Our hope is that more and more patients in the next weeks, months and years to come will be offered this therapy. This is the first step in the right direction to allow more and more patients to be rescued with this therapy.

Can I add a couple of comments to address what's next. We, at Penumbra, we're obviously very, very involved over a decade ago in what happened after the trials in stroke. And it's a similar moment. What -- it was amazing to have that data. But to address your question, that's when the real work started in terms of what to do. There -- we're in a very different spot now than we were in stroke. And I say that just about structurally what the field looks like, there we had to deal with where the patient showed up, potentially moving them to other centers. We don't really have that issue here. And we're years ahead because of the work that PERT has already done, building cross-functional teams where there is an awareness and a desire to treat the group of patients with pulmonary embolism differently. So we're not looking at the same type of road blocks. It doesn't mean we don't have to educate, get out and get that information. And we were thrilled to see the announcement that PERT made about their very ambitious program around education, training at centers, many more members coming in, the level of that engagement that PERT is going to do gives me hope that we're going to see a very different arc around the ability to treat more and more PE patients and get what -- the treatment they deserve. So I'm incredibly optimistic. It is just groundwork. It is just the hard work of -- now the trial is done, how do we educate everyone, how do we get that out there. And I can tell you, we've already had -- we scheduled this at 4 because for the last 1.5 hours before 4 since the presentation, we were on many, many different calls laying out and now that we can publicly talk about it, that work that I've just alluded to. So we haven't -- we didn't do this one first. We did that one first because it matters. No offense, please. And we're just going to do the work. We haven't stopped.

Okay. Let's see other questions. You've been waiting a long time.

I guess just a couple of follow-ups. How quickly do you think guidelines could evolve here? For this to be practice changing, it seems like awareness is the gating factor. So should we think about it being more gradual? Or are there a subset of people kind of waiting out there to get a data like this and you could switch them? And then lastly, how do you think about a class effect here?

Can I address guideline for a second and then open it up for you to disagree with what I'm going to say? Again, living through what we saw in stroke, there is no central body in the world that issues guidelines. There are lots and lots of different organizations that have guidelines suggestions, they call them different things. So there is no -- when you all asked a question about guidelines, that is not a thing that we think about in quite the same way because there's so many different organizations. Some do it every couple of years, you missed their cycle. You don't -- they're not going to do it. It doesn't mean people don't get treated. So guidelines matter. But the most important thing here in the short term for the next period of time is getting hospitals to be aware at the treatment level of what this trial says and what they could do differently. So there are different things, and we understand that difference. We're not waiting for the other. It doesn't mean we're not more than happy when organizations change their recommendation to a guideline. So again, I think I'm stating that right, but I wanted to say that up.

Stavros has written guidelines and has been lead author on many guidelines. Could you comment?

Yes. That's how it is. I mean each guidelines is -- each society that issues guidelines had its own cycle. It could be 3, 4, 5 years. But there's always guidelines that are coming, right, that will be -- will appear, let's say, in a year from now or within a year from now. And this is also the case here. Actually, let's say, from the European point of view, this is a very good moment because the guidelines are being finalized now. And they would -- they should be final early next year and appear some a little bit -- a couple of months later. So this is a moment which is a good one, but also the American Heart Association is going on with guidelines. There are many, many societies all over the world. So you always can have the evidence needed to provide to the next guidelines that will come. And generally, although there are many guidelines in many countries or continents, generally, when the guidelines issue a recommendation, they are in agreement. So it is extremely rare that you will find, let's say, guidelines in North America, saying that guidelines, and Europe saying the opposite or disagree. So this is something when usually -- when the evidence is here, the process of evaluating this evidence of issuing a recommendation is quite similar. So we think this will not be an issue in this case.

If I may, about the class effect, okay? I think there will be a slight class effect but this is a very important concept, and I alluded to this in the presentation, the safety profile that we witnessed during this trial were completely naive operators, did 2 cases and had no device-related complications, no access site complications, no device-related transfusions, I would argue, potentially sets a new gold standard for safety. And I think that as more and more interventional operators, not only in the U.S. but around the world, think about how they're going to incorporate mechanical thrombectomy into their treatment algorithm, they're going to look at this data and look at previously published data, and they're going to question whether or not perhaps a device that they've used historically can offer them that degree of safety. And I think it's a testament to the operators that we had to participate in this trial, but it's also a testament to how uniformly they all said, this is an easy device to learn how to use. It's incredibly safe in my hands, and I think the data bears that out.

And Rob, may I mention that one of the things that distinguishes a device used in this trial from everything else, is this computer algorithm, the flash. And that algorithm, which helps regulate and modulate blood flow is only present in one device. And so whether that can be -- this data could be reproduced by others is something we'll have to see. But I think that when you look at the things that Rob mentioned and when you look at the technology that differentiates this device, I believe this device is its own class. I do not believe that we can generalize every device that's out there that work very differently. We don't function the same. So we'll have to see all that.

Can I add one thing because there was also this very interesting aspect of the question of -- on the proof of cost effectiveness. So I'm not an economist, but we have been also working on a little bit health economic evaluations. And it is very interesting to see, especially with any medical intervention, but in this case, with a catheter intervention, of course, the upfront costs. But the question is, first of all, how many life years you potentially save and how many quality adjusted life years you potentially save and how many indirect costs to reduce by having someone live better, live longer and not seek medical help again and again because they have a lot of rest thrombus and this causes them to go into the hospital again and again after the acute PE. So there is -- the data that we already have is really very promising. And what we were waiting for was also the direct comparison of medical outcomes to strengthen this data. And I am very optimistic. I mean, this is being done by many specialized academic institutions, and we're also collaborating with some of those that the cost-effectiveness data that will follow after the medical data will also be very positive because there are many ways in which you can affect long-term costs also with -- by relieving the patient from the acute clot overload.

And I think that goes into your question about the functional outcomes. And I think that's why the functional outcomes are critically important because we want these people to get back to the life that they had, get back to their jobs, get back to their families. And so those will be critically important.

Yes, Cecilia, go ahead.

Philip Chickering, Deutsche Bank. So every center in this trial had a PERT team. Is that a limitation for adoption going forward? And how do you see expanding our CATV in the hospitals that don't have PERT teams?

Go ahead.

Do you want to go first?

Well, first of all, not every center did. The majority of centers did have a PERT team. And I think that with the new PRISM program with PERT, we will be expanding the number of centers really around the world. So PERT started in the United States. we now have PERT international. So we already have 12 countries, and we have, I think, 50 more that are waiting to sign up. And when you think about PERT teams, even if somebody does not have a formalized PERT team, I think the way that people think about treating PE is very different because it's not -- most places, it's not one person making that decision, it's more than one. So right, it's the ER doctor that sees the patient and calls the interventionalist or the ER doctor sees the patient calls the IC person. So even though they might not call it a formal PERT, it's not one person. So I do think that this can be adopted. Whether centers are calling themselves PERT or not, I do think this opens the opportunity to allow people to think about adopting PERTs and actually formalizing those very easy to do. And again, the PRISM program is really going to help us with that.